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Mobility Services and Electrification Open Up New Markets Worth Billions

Annual Shareholders' Meeting 2017

At the DAX-listed company’s Annual Shareholders’ Meeting, CEO Dr. Degenhart presented mobility services as a growth market of the future for Continental

Sales growth with electrification increases

Developments in technology for safer, efficient, and intelligent mobility

Experts in artificial intelligence working in 14 research disciplines

Hanover, April 28, 2017. At technology company Continental’s Annual Shareholders’ Meeting, CEO Dr. Elmar Degenhart presented cutting-edge technologies for the future of mobility. “The political environment and our industries are changing faster than ever before. Seldom has there been such an exciting and promising time for Continental to shape the future,” commented Degenhart in front of more than 1,000 attendees, as he discussed the general conditions in which Continental is working. He talked about the role that the 227,000-plus employees play in keeping people and goods mobile. “Continental is protecting millions of road users around the world from accidents and their consequences every day. Continental contributes to cleaner air. Continental is paving the way for safe, efficient, and intelligent mobility.” Degenhart cited mobility services as a new growth market. Continental plans to double its current sales of €500 million with mobility services alone by 2020.

“Many things will be different about the car of the future. But one thing will be exactly the same: safe contact with the road.”

In the coming years, Continental is anticipating that industries and markets will undergo fundamental change. The company is working on essential changes to technologies and business models “Electrification, automation, and digitalization – the inner workings of the car as we know it will, in the upcoming 15 years’ time, be made up of completely different components,” Degenhart asserted confidently. “Mobility and the way in which it is delivered are becoming increasingly sustainable as a result. That means safer, more efficient, and more intelligent – with the support of Continental,” he emphasized. One essential principle of safe mobility, however, will remain solid, reliable contact with the road. Degenhart presented the “star of the summer tire range,” the test-winning PremiumContact 6, which is exceptionally efficient and “safely keeps your vehicle in its lane and brings it to a safe stop.”

For drive systems, Continental sees a trend toward electrification in all vehicle classes. “Cars of the future will feature electric drives. But the combustion engine is evolving, too, and still has its peak ahead of it. We don't expect to see a gradual decline in volumes for gasoline and diesel engines until after 2025,” commented Degenhart, confirming the importance of the internal combustion engine on the journey toward electrified mobility. The 48-volt “people’s hybrid” is making highly efficient gasoline and diesel engines more environmentally friendly.

Degenhart sees clear opportunities for growth in electrification: “We are able to generate greater sales per vehicle with our components and systems for electric cars than with solutions for combustion engine drive systems. But there are two main elements that buyers are missing that will ultimately allow the electric vehicle to achieve a breakthrough: greater range and lower acquisition costs. A leap forward in battery-cell technology would be a great help in meeting both requirements. And we expect to see this by 2025.”

Vehicle manufacturers are putting their trust in Continental’s electrical expertise, with the technology company reporting incoming orders of more than €1.2 billion in 2016 for products and systems for hybrid and electric vehicles.

From the first electronic brake system to the mobility services of the future

After reflecting on 33 years of electronic brake systems, Degenhart then spoke to his audience about assisted, automated, and autonomous driving. One product driving growth in this arena is the new 3D Flash Lidar sensor from Continental. The sensor will capture an accurate and distortion-free three-dimensional map of the vehicle's surroundings for the driver assistance systems using invisible flashes of infrared light. “Dim light, darkness, glare, heavy rain? Our laser beams are your vehicle’s sharpest eyes,” explained Degenhart, visibly proud of the work of his 32,000-strong development team.

This development work will also lay the groundwork for future fleets of robot taxis – electrically driven, remotely maintained, and reliably on time wherever people need them, for both individuals and groups. In addition to faster wireless communication standards, Degenhart talked about new mobility services, in which Continental aims to play a key role worldwide, as a basis for the vehicle fleets of the future, operating in interconnected clusters. Accordingly, Continental recently opened a new R&D center in San José in Silicon Valley, focusing on new mobility services.

Degenhart also explained to shareholders the company’s strategy regarding the use of artificial intelligence. “We have 100 experts working all over the world in 14 research disciplines to exploit the opportunities of artificial intelligence. We are collaborating in this field with some outstanding institutions, including the University of Oxford and the Technical Universities in Darmstadt and Munich,” he said.

Continental is using neural networks for the first time on new cameras in its advanced driver assistance systems. Continental also intends to further optimize production processes with the aid of artificial intelligence. Degenhart continued: “The dimensions of a neural production network with our suppliers and customers are enormous. Last year alone, our three automotive divisions supplied our customers with around 1.8 billion products. This required us to purchase around 122 billion components. They were processed at more than 100 of our plants.”

From horsepower and hoof buffers to bits and bytes

On the whole, Degenhart considers Continental, with its history of integrating new technologies and compatible companies stretching back almost 150 years, well prepared for the future of mobility. “We once grew with horsepower and hoof buffers. Nowadays, our growth is driven by billions of bits and bytes. It’s a process of transition. Continental the tire manufacturer, automotive supplier, and industrial partner has become Continental the manufacturer of leading technologies and services. This process of ongoing change offers a range of opportunities for us. We are more determined than ever to systematically seize these opportunities,” said Degenhart, concluding his speech at this year's Annual Shareholders’ Meeting.